RenaissanceRe Reports Net Income Of $180.7 Million For The Third Quarter Of 2012 Or $3.62 Per Diluted Common Share; Quarterly Operating Income Of $104.4 Million Or $2.07 Per Diluted Common Share

RenaissanceRe Holdings Ltd. (NYSE: RNR) today reported net income available to RenaissanceRe common shareholders of $180.7 million or $3.62 per diluted common share in the third quarter of 2012, compared to $49.3 million or $0.95 per diluted common share in the third quarter of 2011. Operating income available to RenaissanceRe common shareholders was $104.4 million or $2.07 per diluted common share for the third quarter of 2012, compared to $32.7 million and $0.62, respectively, in the third quarter of 2011. The Company reported an annualized return on average common equity of 22.0% and an annualized operating return on average common equity of 12.7% in the third quarter of 2012, compared to 6.6% and 4.4%, respectively, in the third quarter of 2011. Book value per common share increased $3.13, or 4.8%, in the third quarter of 2012 to $68.20, compared to a 1.0% increase in the third quarter of 2011.

See Comments on Regulation G for a reconciliation of non-GAAP measures.

Neill A. Currie, CEO, commented: "As we report third quarter results today, our thoughts are primarily with the families, communities and businesses impacted by Sandy and the loss of life and widespread damage they face. We stand ready to do our part in supporting clients and partners as they assess their needs in the aftermath of this storm.

RenaissanceRe had a strong third quarter with growth in tangible book value per share, adjusted for dividends, of 5.3%. Our net income and operating income were $180.7 million and $104.4 million, respectively, driven by strong underwriting profits and investment returns. For the nine months ended September 30, 2012, we generated a 15.4% annualized operating return on equity and have grown our tangible book value per common share plus accumulated dividends, our principal measure of financial performance, by 16.6%."

Mr. Currie added: “We have experienced significant growth this year, deploying capital in an attractive property catastrophe market, which has resulted in an excellent portfolio of risks. This, combined with our access to multiple sources of capital and our experienced underwriting team, provides us with a strong platform from which to approach the January 1st renewal season.”

THIRD QUARTER 2012 HIGHLIGHTS (1)

Gross premiums written decreased $3.6 million, or 2.6%, to $136.4 million. Excluding the impact of $18.2 million of reinstatement premiums written from the large losses during the third quarter of 2011, gross premiums written increased $14.6 million, or 12.0%, due primarily to growth in the Company's specialty and Lloyd's units.

Underwriting income of $122.6 million and a combined ratio of 53.3%, compared to $83.2 million and 63.7%, respectively. These results were primarily driven by an increase in net premiums earned of $33.4 million due to an increase in gross premiums written, excluding reinstatement premiums, of $261.4 million, or 21.1% during the nine months ended September 30, 2012, compared to the nine months ended September 30, 2011, and also as a result of a $4.6 million decrease in net claims and claim expenses during the quarter. Included in net claims and claim expenses of $73.2 million is $29.0 million related to hurricane Isaac, $23.5 million in estimated ultimate losses associated with potential exposure to LIBOR related claims and $8.0 million related to the 2012 crop season. Hurricane Isaac had a net negative impact of $15.6 million or 10.6 percentage points, on the Company's consolidated results and combined ratio, respectively.

Total investment income of $122.7 million, which includes the sum of net investment income, net realized and unrealized gains on investments and net other-than-temporary impairments, compared to a loss of $18.6 million. This was driven by higher total returns in the Company's fixed maturity investment portfolio as a result of increased allocations to credit which benefited from tightening spreads across most sectors during the quarter combined with an increase in average invested assets and improved returns in the Company's portfolio of other investments, principally as a result of increased valuations in the equity markets.

Net income attributable to redeemable noncontrolling interests of $51.1 million increased from $5.0 million, primarily impacted by an increase in profitability of DaVinciRe and a decrease in the Company's ownership percentage in DaVinciRe from 42.8% at September 30, 2011 to 31.5% at September 30, 2012.

Underwriting Results by Segment (1)

Reinsurance Segment

Gross premiums written in the Reinsurance segment were $107.6 million, a decrease of $15.2 million, or 12.4%. Excluding the impact of $18.7 million of reinstatement premiums written from large losses in the third quarter of 2011, gross premiums written increased $3.5 million, or 3.4%, as a result of relatively flat market conditions and timing of the Japanese reinsurance renewals. Managed catastrophe premiums totaled $77.4 million, a decrease of $16.9 million, or 17.9%, excluding the impact of reinstatement premiums written in the third quarter of 2011, due in part to the Japanese reinsurance renewals within the catastrophe unit being written in the second quarter during 2012, versus the third quarter in 2011. In addition, gross premiums written in the specialty unit were $37.9 million, an increase of $12.3 million, or 48.2%, due to the inception of several new quota share contracts.

For the first nine months of 2012, managed catastrophe premiums totaled $1,264.7 million, an increase of $190.3 million, or 17.2%, compared to the first nine months of 2011, excluding the impact of $30.7 million of negative reinstatement premiums adjustments in the first nine months of 2012, and $154.8 million of reinstatement premiums written from large losses in the first nine months of 2011. Gross premiums written in the specialty unit for the first nine months of 2012 were $175.8 million, an increase of $51.0 million, or 40.9%, compared to the first nine months of 2011 due to the inception of several new quota share contracts.

The Reinsurance segment generated underwriting income of $134.2 million and a combined ratio of 41.8%, compared to $95.1 million and 54.3%, respectively, primarily as a result of an $11.5 million decrease in net claims and claim expenses and a $22.3 million increase in net premiums earned. Included in net claims and claim expenses is $28.5 million and $16.0 million related to hurricane Isaac and estimated ultimate losses related to potential exposure to LIBOR related claims attributable to the current accident year. Hurricane Isaac had a net negative impact of $23.1 million or 12.3 percentage points, on the Reinsurance segment's underwriting result and combined ratio, respectively.

The Reinsurance segment experienced $17.4 million of favorable development on prior year reserves, compared to $13.8 million, including $17.9 million of favorable development in the catastrophe unit and $0.5 million of adverse development in the specialty unit. Development within the catastrophe unit is primarily due to $16.3 million related to the 2008 hurricanes. The specialty unit prior accident years adverse development of $0.5 million includes $5.0 million of estimated ultimate losses related to potential exposure to LIBOR related claims.

Lloyd's Segment

Gross premiums written in the Lloyd's segment were $28.7 million, an increase of $11.6 million, or 67.7%, primarily due to continued growth within the segment. For the first nine months of 2012, gross premiums written in the Lloyd's segment were $133.8 million, an increase of $46.0 million, or 52.3%. The Lloyd's segment incurred an underwriting loss of $11.5 million and a combined ratio of 135.6%, compared to $6.9 million and 133.3%, respectively. Included in net claims and claim expenses of $26.3 million is $7.5 million due to the U.S. drought impacting the 2012 crop season and estimated ultimate losses of $2.5 million associated with potential exposure to LIBOR related claims attributable to the current accident year.

Other Items (1)

The Company's weather and energy risk management operations generated income of $0.2 million, compared to a loss of $3.2 million, primarily due to the absence of the losses which were experienced during the third quarter of 2011 as a result of warm temperatures in both the U.S. and certain parts of Europe.

During the third quarter of 2012, the Company repurchased approximately 2.4 million common shares in open market transactions at an aggregate cost of $180.3 million and at an average share price of $75.41.

Subsequent to September 30, 2012 and through the period ending October 31, 2012, the Company repurchased approximately 111 thousand common shares in open market transactions at an aggregate cost of $8.5 million and at an average share price of $77.01.

In late October, hurricane Sandy impacted the Mid-Atlantic and Northeast coasts of the U.S., ultimately making landfall in New Jersey, with tropical storm force or greater winds at landfall extending over approximately 550,000 square miles. In addition, hurricane Sandy generated significant storm surge, which contributed substantially to loss of life, widespread power outages, significant disruptions to travel and devastating flooding throughout a number of states, including New York and New Jersey. Hurricane Sandy is currently estimated to have been the largest Atlantic hurricane in diameter ever recorded and to have produced the lowest barometric pressure readings for an Atlantic windstorm north of North Carolina. Given the severe magnitude and recent occurrence of this event, and the ongoing dislocation within the affected region, there is a lack of data available from industry participants and clients, resulting in significant uncertainty with respect to potential insured losses from this event, and also with respect to the Company's potential losses from this event.Accordingly, it is not possible at this time to provide an estimate of the financial impact of this event on the Company. Based upon the current publicly available industry preliminary insured loss estimates, market share analysis, the application of the Company's modeling techniques and a review of the Company's in-force contracts, the Company's current preliminary assessment is that the impact of hurricane Sandy on its financial results (net of reinstatement premiums, retrocessional recoveries and noncontrolling interest) will likely be significant. Losses from this event will be recorded in the Company's fourth quarter 2012 results and any subsequent changes in these estimates will be recorded in the period in which they occur.

This Press Release includes certain non-GAAP financial measures including “operating income (loss) available (attributable) to RenaissanceRe common shareholders”, “operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted”, “operating return on average common equity - annualized”, “managed catastrophe premiums”, "tangible book value per common share" and "tangible book value per common share plus accumulated dividends." A reconciliation of such measures to the most comparable GAAP figures in accordance with Regulation G is presented in the attached supplemental financial data.

Please refer to the “Investor Information - Financial Reports - Financial Supplements” section of the Company's website at www.renre.com for a copy of the Financial Supplement which includes additional information on the Company's financial performance.

RenaissanceRe Holdings Ltd. will host a conference call on Friday, November 2, 2012 at 11:00 a.m. (ET) to discuss this release. Live broadcast of the conference call will be available through the “Investor Information - Company Webcasts” section of RenaissanceRe's website at www.renre.com.

RenaissanceRe Holdings Ltd. is a global provider of reinsurance and insurance. The Company's business consists of three segments: (i) Reinsurance, which includes catastrophe reinsurance, specialty reinsurance and certain property catastrophe and specialty joint ventures managed by the Company's ventures unit, (ii) Lloyd's, which includes reinsurance and insurance business written through Syndicate 1458, and (iii) Insurance, which principally includes the Company's Bermuda-based insurance operations.

Cautionary Statement under “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995: Statements made in this earnings release contain information about the Company's future business prospects.These statements may be considered “forward-looking.”These statements are subject to risks and uncertainties that could cause actual results to differ materially from those set forth in or implied by such forward-looking statements.For further information regarding cautionary statements and factors affecting future results, please refer to RenaissanceRe Holdings Ltd.'s filings with the Securities and Exchange Commission, including its Annual Reports on Form 10-K and its Quarterly Reports on Form 10-Q.

(1) All comparisons are with the third quarter of 2011 unless specifically stated.

(2) Net negative impact includes the sum of estimates of net claims and claim expenses incurred, earned reinstatement premiums assumed and ceded, lost profit commissions and redeemable noncontrolling interest - DaVinci Re. The Company's estimates are based on a review of its potential exposures, preliminary discussions with certain counterparties and catastrophe modeling techniques. Given the magnitude and recent occurrence of these events, delays in receiving claims data, potential uncertainties relating to reinsurance recoveries and other uncertainties inherent in loss estimation, meaningful uncertainty remains regarding losses from these events. Accordingly, the Company's actual net impact from these events will vary from these preliminary estimates, perhaps materially so. Changes in these estimates will be recorded in the period in which they occur.

RenaissanceRe Holdings Ltd.

Summary Consolidated Statements of Operations

(in thousands of United States Dollars, except per share amounts and percentages)

(Unaudited)

Three months ended

Nine months ended

September 30, 2012

September 30, 2011

September 30, 2012

September 30, 2011

Revenues

Gross premiums written

$

136,359

$

139,938

$

1,467,846

$

1,392,006

Net premiums written

$

105,035

$

103,010

$

1,025,240

$

983,580

Decrease (increase) in unearned premiums

157,588

126,214

(239,536

)

(231,640

)

Net premiums earned

262,623

229,224

785,704

751,940

Net investment income (loss)

45,164

(27,940

)

126,878

65,669

Net foreign exchange gains (losses)

3,001

(2,650

)

3,951

(6,511

)

Equity in earnings (losses) of other ventures

4,310

4,794

16,626

(13,831

)

Other (loss) income

(881

)

(2,015

)

(28,686

)

42,963

Net realized and unrealized gains on fixed maturity investments

76,258

16,983

153,374

46,748

Total other-than-temporary impairments

—

(498

)

(395

)

(498

)

Portion recognized in other-than-temporary impairments

—

49

52

49

Net other-than-temporary impairments

—

(449

)

(343

)

(449

)

Total revenues

390,475

217,947

1,057,504

886,529

Expenses

Net claims and claim expenses incurred

73,215

77,830

138,318

857,628

Acquisition expenses

24,438

26,057

74,157

72,275

Operational expenses

42,390

42,169

126,180

126,298

Corporate expenses

3,850

3,582

12,728

9,657

Interest expense

5,891

5,722

17,325

17,647

Total expenses

149,784

155,360

368,708

1,083,505

Income (loss) from continuing operations before taxes

240,691

62,587

688,796

(196,976

)

Income tax (expense) benefit

(144

)

1,435

(1,005

)

3,260

Income (loss) from continuing operations

240,547

64,022

687,791

(193,716

)

(Loss) income from discontinued operations

(54

)

(965

)

1,166

(12,585

)

Net income (loss)

240,493

63,057

688,957

(206,301

)

Net (income) loss attributable to noncontrolling interests

(51,083

)

(5,044

)

(138,348

)

58,545

Net income (loss) available (attributable) to RenaissanceRe

189,410

58,013

550,609

(147,756

)

Dividends on preference shares

(8,750

)

(8,750

)

(26,250

)

(26,250

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders

$

180,660

$

49,263

$

524,359

$

(174,006

)

Income (loss) from continuing operations available (attributable) to RenaissanceRe common shareholders per common share - basic

$

3.67

$

0.98

$

10.36

$

(3.19

)

(Loss) income from discontinued operations (attributable) available to RenaissanceRe common shareholders per common share - basic

—

(0.02

)

0.02

(0.25

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - basic

$

3.67

$

0.96

$

10.38

$

(3.44

)

Income (loss) from continuing operations available (attributable) to RenaissanceRe common shareholders per common share - diluted (1)

$

3.62

$

0.97

$

10.22

$

(3.19

)

(Loss) income from discontinued operations (attributable) available to RenaissanceRe common shareholders per common share - diluted (1)

—

(0.02

)

0.02

(0.25

)

Net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted (1)

$

3.62

$

0.95

$

10.24

$

(3.44

)

Average shares outstanding - basic (1)

48,394

50,501

49,683

50,830

Average shares outstanding - diluted (1)

49,119

50,973

50,370

50,830

Net claims and claim expense ratio

27.9

%

34.0

%

17.6

%

114.1

%

Expense ratio

25.4

%

29.7

%

25.5

%

26.4

%

Combined ratio

53.3

%

63.7

%

43.1

%

140.5

%

Operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted (2)

$

2.07

$

0.62

$

7.21

$

(4.35

)

Operating return on average common equity - annualized (2)

12.7

%

4.4

%

15.4

%

(9.6

)%

(1)

Earnings per share calculations use average common shares outstanding - basic, when in a net loss position, as required by FASB ASC Topic Earnings per Share.

(2)

See Comments on Regulation G for a reconciliation of non-GAAP financial measures.

RenaissanceRe Holdings Ltd.

Summary Consolidated Balance Sheets

(in thousands of United States Dollars, except per share amounts)

September 30, 2012

December 31, 2011

Assets

Fixed maturity investments trading, at fair value

$

5,089,540

$

4,291,465

Fixed maturity investments available for sale, at fair value

94,826

142,052

Total fixed maturity investments, at fair value

5,184,366

4,433,517

Short term investments, at fair value

679,356

905,477

Equity investments trading, at fair value

57,617

50,560

Other investments, at fair value

752,000

748,984

Investments in other ventures, under equity method

82,212

70,714

Total investments

6,755,551

6,209,252

Cash and cash equivalents

249,123

216,984

Premiums receivable

701,240

471,878

Prepaid reinsurance premiums

189,592

58,522

Reinsurance recoverable

209,490

404,029

Accrued investment income

37,327

33,523

Deferred acquisition costs

83,222

43,721

Receivable for investments sold

344,367

117,117

Other assets

215,008

180,992

Goodwill and other intangibles

8,588

8,894

Total assets

$

8,793,508

$

7,744,912

Liabilities, Noncontrolling Interests and Shareholders' Equity

Liabilities

Reserve for claims and claim expenses

$

1,782,680

$

1,992,354

Unearned premiums

718,261

347,655

Debt

358,595

353,620

Reinsurance balances payable

356,136

256,883

Payable for investments purchased

576,052

303,264

Other liabilities

206,709

211,369

Liabilities of discontinued operations held for sale

1,318

13,507

Total liabilities

3,999,751

3,478,652

Redeemable noncontrolling interest - DaVinciRe

950,822

657,727

Shareholders' Equity

Preference shares

550,000

550,000

Common shares

48,228

51,543

Accumulated other comprehensive income

14,067

11,760

Retained earnings

3,226,661

2,991,890

Total shareholders' equity attributable to RenaissanceRe

3,838,956

3,605,193

Noncontrolling interest

3,979

3,340

Total shareholders' equity

3,842,935

3,608,533

Total liabilities, noncontrolling interests and shareholders' equity

$

8,793,508

$

7,744,912

Book value per common share

$

68.20

$

59.27

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Segment Information

(in thousands of United States Dollars, except percentages)

(Unaudited)

Three months ended September 30, 2012

Reinsurance

Lloyd’s

Insurance

Other

Total

Gross premiums written

$

107,637

$

28,722

$

—

$

—

$

136,359

Net premiums written

$

78,164

$

26,982

$

(111

)

—

$

105,035

Net premiums earned

$

230,359

$

32,375

$

(111

)

—

$

262,623

Net claims and claim expenses incurred

47,080

26,331

(196

)

—

73,215

Acquisition expenses

18,258

6,051

129

—

24,438

Operational expenses

30,856

11,532

2

—

42,390

Underwriting income (loss)

$

134,165

$

(11,539

)

$

(46

)

—

122,580

Net investment income

45,164

45,164

Net foreign exchange gains

3,001

3,001

Equity in earnings of other ventures

4,310

4,310

Other loss

(881

)

(881

)

Net realized and unrealized gains on investments

76,258

76,258

Corporate expenses

(3,850

)

(3,850

)

Interest expense

(5,891

)

(5,891

)

Income from continuing operations before taxes

240,691

Income tax expense

(144

)

(144

)

Loss from discontinued operations

(54

)

(54

)

Net income attributable to noncontrolling interests

(51,083

)

(51,083

)

Dividends on preference shares

(8,750

)

(8,750

)

Net income available to RenaissanceRe common shareholders

$

180,660

Net claims and claim expenses incurred – current accident year

$

64,488

$

29,051

$

—

$

93,539

Net claims and claim expenses incurred – prior accident years

(17,408

)

(2,720

)

(196

)

(20,324

)

Net claims and claim expenses incurred – total

$

47,080

$

26,331

$

(196

)

$

73,215

Net claims and claim expense ratio – current accident year

28.0

%

89.7

%

—

35.6

%

Net claims and claim expense ratio – prior accident years

(7.6

)%

(8.4

)%

176.6

%

(7.7

)%

Net claims and claim expense ratio – calendar year

20.4

%

81.3

%

176.6

%

27.9

%

Underwriting expense ratio

21.4

%

54.3

%

(118.0

)%

25.4

%

Combined ratio

41.8

%

135.6

%

58.6

%

53.3

%

Three months ended September 30, 2011

Reinsurance

Lloyd’s

Insurance

Other

Total

Gross premiums written

$

122,811

$

17,127

$

—

$

—

$

139,938

Net premiums written

$

86,745

$

16,125

$

140

—

$

103,010

Net premiums earned

$

208,074

$

20,797

$

353

—

$

229,224

Net claims and claim expenses incurred

58,565

14,141

5,124

—

77,830

Acquisition expenses

21,964

4,013

80

—

26,057

Operational expenses

32,462

9,560

147

—

42,169

Underwriting income (loss)

$

95,083

$

(6,917

)

$

(4,998

)

—

83,168

Net investment loss

(27,940

)

(27,940

)

Net foreign exchange losses

(2,650

)

(2,650

)

Equity in earnings of other ventures

4,794

4,794

Other loss

(2,015

)

(2,015

)

Net realized and unrealized gains on investments

16,983

16,983

Net other-than-temporary impairments

(449

)

(449

)

Corporate expenses

(3,582

)

(3,582

)

Interest expense

(5,722

)

(5,722

)

Income from continuing operations before taxes

62,587

Income tax benefit

1,435

1,435

Loss from discontinued operations

(965

)

(965

)

Net income attributable to noncontrolling interests

(5,044

)

(5,044

)

Dividends on preference shares

(8,750

)

(8,750

)

Net income available to RenaissanceRe common shareholders

$

49,263

Net claims and claim expenses incurred – current accident year

$

72,358

$

14,089

$

(17

)

$

86,430

Net claims and claim expenses incurred – prior accident years

(13,793

)

52

5,141

(8,600

)

Net claims and claim expenses incurred – total

$

58,565

$

14,141

$

5,124

$

77,830

Net claims and claim expense ratio – current accident year

34.8

%

67.7

%

(4.8

)%

37.7

%

Net claims and claim expense ratio – prior accident years

(6.7

)%

0.3

%

1,456.4

%

(3.7

)%

Net claims and claim expense ratio – calendar year

28.1

%

68.0

%

1,451.6

%

34.0

%

Underwriting expense ratio

26.2

%

65.3

%

64.3

%

29.7

%

Combined ratio

54.3

%

133.3

%

1,515.9

%

63.7

%

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Segment Information

(in thousands of United States Dollars, except percentages)

(Unaudited)

Nine months ended September 30, 2012

Reinsurance

Lloyd’s

Insurance

Eliminations

Other

Total

Gross premiums written

$

1,334,438

$

133,836

$

—

$

(428

)

$

—

$

1,467,846

Net premiums written

$

916,171

$

109,429

$

(360

)

—

$

1,025,240

Net premiums earned

$

698,473

$

87,566

$

(335

)

—

$

785,704

Net claims and claim expenses incurred

90,892

50,292

(2,866

)

—

138,318

Acquisition expenses

57,742

16,229

186

—

74,157

Operational expenses

93,246

32,395

539

—

126,180

Underwriting income (loss)

$

456,593

$

(11,350

)

$

1,806

—

447,049

Net investment income

126,878

126,878

Net foreign exchange gains

3,951

3,951

Equity in earnings of other ventures

16,626

16,626

Other loss

(28,686

)

(28,686

)

Net realized and unrealized gains on investments

153,374

153,374

Net other-than-temporary impairments

(343

)

(343

)

Corporate expenses

(12,728

)

(12,728

)

Interest expense

(17,325

)

(17,325

)

Income from continuing operations before taxes

688,796

Income tax expense

(1,005

)

(1,005

)

Income from discontinued operations

1,166

1,166

Net income attributable to noncontrolling interests

(138,348

)

(138,348

)

Dividends on preference shares

(26,250

)

(26,250

)

Net income available to RenaissanceRe common shareholders

$

524,359

Net claims and claim expenses incurred – current accident year

$

196,263

$

63,697

$

—

$

259,960

Net claims and claim expenses incurred – prior accident years

(105,371

)

(13,405

)

(2,866

)

(121,642

)

Net claims and claim expenses incurred – total

$

90,892

$

50,292

$

(2,866

)

$

138,318

Net claims and claim expense ratio – current accident year

28.1

%

72.7

%

—

33.1

%

Net claims and claim expense ratio – prior accident years

(15.1

)%

(15.3

)%

855.5

%

(15.5

)%

Net claims and claim expense ratio – calendar year

13.0

%

57.4

%

855.5

%

17.6

%

Underwriting expense ratio

21.6

%

55.6

%

(216.4

)%

25.5

%

Combined ratio

34.6

%

113.0

%

639.1

%

43.1

%

Nine months ended September 30, 2011

Reinsurance

Lloyd’s

Insurance

Eliminations

Other

Total

Gross premiums written

$

1,303,897

$

87,873

$

313

$

(77

)

$

—

$

1,392,006

Net premiums written

$

906,167

$

76,946

$

467

—

$

983,580

Net premiums earned

$

696,964

$

53,704

$

1,272

—

$

751,940

Net claims and claim expenses incurred

797,188

53,283

7,157

—

857,628

Acquisition expenses

62,187

9,779

309

—

72,275

Operational expenses

97,726

27,167

1,405

—

126,298

Underwriting loss

$

(260,137

)

$

(36,525

)

$

(7,599

)

—

(304,261

)

Net investment income

65,669

65,669

Net foreign exchange losses

(6,511

)

(6,511

)

Equity in losses of other ventures

(13,831

)

(13,831

)

Other income

42,963

42,963

Net realized and unrealized gains on investments

46,748

46,748

Net other-than-temporary impairments

(449

)

(449

)

Corporate expenses

(9,657

)

(9,657

)

Interest expense

(17,647

)

(17,647

)

Loss from continuing operations before taxes

(196,976

)

Income tax benefit

3,260

3,260

Loss from discontinued operations

(12,585

)

(12,585

)

Net loss attributable to noncontrolling interests

58,545

58,545

Dividends on preference shares

(26,250

)

(26,250

)

Net loss attributable to RenaissanceRe common shareholders

$

(174,006

)

Net claims and claim expenses incurred – current accident year

$

902,118

$

53,027

$

(86

)

$

955,059

Net claims and claim expenses incurred – prior accident years

(104,930

)

256

7,243

(97,431

)

Net claims and claim expenses incurred – total

$

797,188

$

53,283

$

7,157

$

857,628

Net claims and claim expense ratio – current accident year

129.4

%

98.7

%

(6.8

)%

127.0

%

Net claims and claim expense ratio – prior accident years

(15.0

)%

0.5

%

569.5

%

(12.9

)%

Net claims and claim expense ratio – calendar year

114.4

%

99.2

%

562.7

%

114.1

%

Underwriting expense ratio

22.9

%

68.8

%

134.7

%

26.4

%

Combined ratio

137.3

%

168.0

%

697.4

%

140.5

%

(1)

Represents $0.4 million of gross premiums ceded from the Reinsurance segment to the Lloyd's segment for the nine months ended September 30, 2012 (2011 - $0.1 million).

Catastrophe premiums written on behalf of our joint venture, Top Layer Re (2)

5,382

12,379

70,867

53,986

Catastrophe premiums written in the Lloyd's segment

2,267

2,837

35,127

26,802

Total managed catastrophe premiums (1)

$

77,354

$

112,433

$

1,264,677

$

1,259,929

(1)

See Comments on Regulation G for a reconciliation of non-GAAP financial measures.

(2)

Top Layer Re is accounted for under the equity method of accounting.

RenaissanceRe Holdings Ltd.

Supplemental Financial Data - Total Investment Result

(in thousands of United States Dollars)

(Unaudited)

Three months ended

Nine months ended

September 30, 2012

September 30, 2011

September 30, 2012

September 30, 2011

Fixed maturity investments

$

24,785

$

11,435

$

73,554

$

63,774

Short term investments

219

281

953

1,309

Equity investments trading

181

171

532

297

Other investments

Hedge funds and private equity investments

10,383

(25,702

)

28,443

6,035

Other

12,737

(11,665

)

31,882

2,000

Cash and cash equivalents

63

66

143

152

48,368

(25,414

)

135,507

73,567

Investment expenses

(3,204

)

(2,526

)

(8,629

)

(7,898

)

Net investment income (loss)

45,164

(27,940

)

126,878

65,669

Gross realized gains

19,891

38,054

75,635

64,046

Gross realized losses

(2,811

)

(6,099

)

(13,055

)

(22,872

)

Net realized gains on fixed maturity investments

17,080

31,955

62,580

41,174

Net unrealized gains (losses) on fixed maturity investments trading

56,942

(13,007

)

83,737

7,963

Net unrealized gains (losses) on equity investments trading

2,236

(1,965

)

7,057

(2,389

)

Net realized and unrealized gains on investments

76,258

16,983

153,374

46,748

Total other-than-temporary impairments

—

(498

)

(395

)

(498

)

Portion recognized in other comprehensive income, before taxes

—

49

52

49

Net other-than-temporary impairments

—

(449

)

(343

)

(449

)

Change in net unrealized gains on fixed maturity investments available for sale

1,326

(7,171

)

1,398

(8,682

)

Total investment income (loss)

$

122,748

$

(18,577

)

$

281,307

$

103,286

Comments on Regulation G

In addition to the GAAP financial measures set forth in this Press Release, the Company has included certain non-GAAP financial measures in this Press Release within the meaning of Regulation G. The Company has provided these financial measurements in previous investor communications and the Company's management believes that these measurements are important to investors and other interested persons, and that investors and such other persons benefit from having a consistent basis for comparison between quarters and for the comparison with other companies within the industry. These measures may not, however, be comparable to similarly titled measures used by companies outside of the insurance industry. Investors are cautioned not to place undue reliance on these non-GAAP measures in assessing the Company's overall financial performance.

The Company uses “operating income (loss) available (attributable) to RenaissanceRe common shareholders” as a measure to evaluate the underlying fundamentals of its operations and believes it to be a useful measure of its corporate performance. “Operating income (loss) available (attributable) to RenaissanceRe common shareholders” as used herein differs from “net income (loss) available (attributable) to RenaissanceRe common shareholders,” which the Company believes is the most directly comparable GAAP measure, by the exclusion of net realized and unrealized gains and losses on investments from continuing and discontinued operations and net other-than-temporary impairments from continuing and discontinued operations. The Company's management believes that “operating income (loss) available (attributable) to RenaissanceRe common shareholders” is useful to investors because it more accurately measures and predicts the Company's results of operations by removing the variability arising from fluctuations in the Company's fixed maturity investment portfolio and equity investments trading. The Company also uses “operating income (loss) available (attributable) to RenaissanceRe common shareholders” to calculate “operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted” and “operating return on average common equity - annualized”. The following is a reconciliation of: 1) net income (loss) available (attributable) to RenaissanceRe common shareholders to operating income (loss) available (attributable) to RenaissanceRe common shareholders; 2) net income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted to operating income (loss) available (attributable) to RenaissanceRe common shareholders per common share - diluted; and 3) return on average common equity - annualized to operating return on average common equity - annualized:

Three months ended

Nine months ended

(in thousands of United States Dollars, except percentages)

September 30, 2012

September 30, 2011

September 30, 2012

September 30, 2011

Net income (loss) available (attributable) to RenaissanceRe common shareholders

$

180,660

$

49,263

$

524,359

$

(174,006

)

Adjustment for net realized and unrealized gains on investments of continuing operations

The Company has also included in this Press Release “managed catastrophe premiums”. “Managed catastrophe premiums” is defined as gross catastrophe premiums written by Renaissance Reinsurance and its related joint ventures. “Managed catastrophe premiums” differs from total catastrophe unit gross premiums written, which the Company believes is the most directly comparable GAAP measure, due to the inclusion of catastrophe premiums written on behalf of the Company's joint venture Top Layer Re, which is accounted for under the equity method of accounting and the inclusion of catastrophe premiums written on behalf of the Company's Lloyd's segment. The Company's management believes “managed catastrophe premiums” is useful to investors and other interested parties because it provides a measure of total catastrophe premiums, as applicable, assumed by the Company through its consolidated subsidiaries and related joint ventures.

The Company has also included in this Press Release “tangible book value per common share” and “tangible book value per common share plus accumulated dividends”. “Tangible book value per common share” is defined as book value per common share excluding goodwill and intangible assets per share; “tangible book value per common share plus accumulated dividends” is defined as book value per common share excluding goodwill and intangible assets per share, plus accumulated dividends. “Tangible book value per common share” differs from book value per common share, which the Company believes is the most directly comparable GAAP measure, due to the exclusion of goodwill and intangible assets per share. The Company's management believes “tangible book value per common share” and “tangible book value per common share plus accumulated dividends” are useful to investors because they provide a more accurate measure of the realizable value of shareholder returns, excluding the impact of goodwill and intangible assets. The following is a reconciliation of book value per common share to tangible book value per common share and tangible book value per common share plus accumulated dividends:

At

September 30, 2012

June 30, 2012

March 31, 2012

December 31, 2011

September 30,

2011

Book value per common share

$

68.20

$

65.07

$

62.68

$

59.27

$

57.89

Adjustment for goodwill and other intangibles (1)

(0.85

)

(0.83

)

(0.84

)

(0.82

)

(0.94

)

Tangible book value per common share

67.35

64.24

61.84

58.45

56.95

Adjustment for accumulated dividends

11.73

11.46

11.19

10.92

10.66

Tangible book value per common share plus accumulated dividends

$

79.08

$

75.70

$

73.03

$

69.37

$

67.61

Quarter change in book value per common share

4.8

%

3.8

%

5.8

%

2.4

%

1.0

%

Quarter change in tangible book value per common share plus change in accumulated dividends

5.3

%

4.3

%

6.3

%

3.1

%

1.5

%

Year to date change in book value per common share

15.1

%

Year to date change in tangible book value per common share plus change in accumulated dividends

16.6

%

(1)

At September 30, 2012, June 30, 2012, March 31, 2012, December 31, 2011 and September 30, 2011, goodwill and other intangibles included $32.2 million, $33.3 million, $34.5 million, $33.5 million and $34.2 million, respectively, of goodwill and other intangibles included in investments in other ventures, under equity method.